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International Forum >> The Democracy Forum for East Asia>> "Political Finance and Democracy in East Asia: The Use and Abuse of Money in Campaigns and Elections"
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Introduction
Session I: Political Finance in a Comparative Context Session II: Political Finance in the Philippines, Thailand, Indonesia, and India Session III: Political Finance in Korea, Japan, and Taiwan Session IV: Regulating Campaign Contributions and Expenditures Session V: Disclosure, Transparency, and Institutional Enforcement Session VI: Making Political Finance More Democratic: Developing an Agenda for Reform Agenda Participants |
Session II: Political Finance in the Philippines, Thailand, Indonesia, and India Moderator: Kie-Duck Park The second session featured the presentation of case studies of political finance regulations and practices in four Asian countries: the Philippines, Thailand, Indonesia, and India. The Case of the Philippines "If you are not rich-or do not have a rich patron-you cannot get elected in the Philippines." So asserted Joel Rocamora, a Filipino political scientist and author of the case study of the Philippines, who asserted that political finance is the primary source of corruption in his country today. Filipino political parties are weak, Rocamora reported; most do not even maintain organizations or headquarters between elections. As a consequence, candidates decide on their own to contest elections, often based on calculations of how much money they can raise and what the likely financial rewards of office will be. Candidates need money to secure nominations, to gather votes and to have them counted, and to have votes for their opponents miscounted or voided. Numerous opportunities for fraud exist at every stage in this process, Rocamora detailed. Candidate organizations engage in vote buying at the retail level by rewarding individual voters with small cash payments, and also at the wholesale level by bribing officials who tally votes in electoral districts. The primary sources of campaign contributions in the Philippines include legal businesses, illegal businesses such as gambling and the drug trade, the illegal use of government funds, and private or family funds. The entire system, Rocamora said, is based not on competing ideas about public policy but on mutually beneficial patron-client relationships that flourish in a complex arena of corruption. Ironically, the Philippines has strict laws prohibiting campaign contributions from a variety of economic interests, including financial institutions, public utilities, government contractors, government employees, and members of the armed forces. A major step toward reforming the political process would simply be enforcing the existing laws, Rocamora concluded. The Case of Thailand The adoption of a new constitution in 1997 marked a major turning point in Thailand's political history, according to Borwornsak Uwanno, author of the case study on that country. For most of the period of Thailand's constitutional monarchy (since 1932), political parties were primarily electoral machines, not ideological groupings. Most Thai parties did not form as associations of like-minded individuals but were created and registered by government edict to promote political stability. The Thai constitution of 1974, for example, required that members of parliament not only be members of a political party but members of a party that fielded candidates for at least half of all seats in the national legislature. This requirement was reduced to one-third of the seats in the 1991 constitution, but the provision still means that small, poorly-funded parties cannot be represented in parliament. Partly as a result of these provisions, many wealthy businessmen decided in the 1980s and 1990s that the easiest way to influence government policy was to join political parties and to run for parliament themselves. Although Thai parliamentary elections are subject to spending limits, most knowledgeable observers believe that candidates spend more-and often vastly more-than the limits permit on legal expenditures such as staff salaries, travel, office space, and printed campaign materials. Thai elections also feature large amounts of unreported spending on illegal activities, especially vote buying. As in the Philippines, Borwornsak said, candidates offer cash payments or small gifts to individual voters and larger bribes to election officials. The problem is a difficult one for reformers, since numerous polls have shown that many Thai voters see nothing wrong with receiving gifts from candidates. In 1997 Thailand adopted a new constitution that included several provisions designed to fight political and financial corruption. One such provision introduced compulsory voting in an effort to make the electorate so large that vote buying would become prohibitively expensive. Another provision created a mixed electoral system in which some members of parliament are elected under a party-list system that favors large parties, while the vast majority are elected in single-member constituencies. Thailand also created an independent election commission to administer elections and to adjudicate electoral disputes. It established new principles for internal democracy within political parties and removed the requirement that parties field candidates for a prescribed number of seats (so that smaller parties could contest as many or as few elections as their resources permitted). And it mandated far greater transparency for both donors and recipients in political finance transactions. These measures appear to be having at least some of their desired effects, but much more needs to be done to reform the political process in Thailand, Borwornsak concluded. The Case of Indonesia Since 1999 Indonesia has gone from being a one-party authoritarian state to a new democracy with 43 parties contesting elections and 41 parties represented in parliament. It is not surprising, according to scholars Smita Notosusanto and Hadar Gumay, that Indonesia today faces numerous problems of democratic consolidation, including those related to political finance. The country's political finance regulations date only to 1999, when existing laws on political parties and the conduct of elections were amended in response to new political realities. Although the new regulations set ceilings on political contributions and require that parties file audited financial reports, they do not clearly distinguish between regular party finances and campaign finances; in fact, they do not even clearly define the electoral period. As a result, candidates, parties, and outside observers often have vastly different understandings of what is permitted and prohibited under current law. Obtaining reliable data on the cost of elections is difficult in Indonesia, as it is in other countries in East Asia. One local advertising firm calculated that political parties spent more on media advertising in 1999 than they reported in total spending for that year. But parties and candidates also spent funds on mass rallies, on campaign travel for candidates and staff, and on party offices and personnel. The then-ruling GOLKAR party was also able to misuse state funds and facilities for campaign purposes. Many of these costs were underreported or not reported at all. Despite these apparent violations, the Supreme Court has not taken any enforcement actions against political parties, even against the dozens of parties that failed to submit required disclosure reports. While many party leaders argue that mandatory disclosure and the strict enforcement of campaign finance regulations discourage political contributions at a time when fledgling parties are fighting for survival, a number of civil society organizations in Indonesia continue to press for additional reforms. But "the public is generally pessimistic about any effort to curb the influence of money on the outcome of elections," Notosusanto and Gumay concluded. The Case of India Fifty years after achieving its independence, India is still largely a rural country with a huge electorate, according to E. Sridharan, author of the case study of the world's most populous democracy. Electioneering in India is labor-intensive, as candidates must employ large staffs to reach rural voters and must also spend large amounts for travel, vehicles and fuel, and the printing of campaign materials. Meanwhile, in India's huge urban areas, candidates need large sums for mass-market advertising, polling, consulting, and the other necessities of modern election campaigns. In addition, India has had five general elections since 1989, most of which have resulted in short-lived coalition governments. These factors combine to place constant pressure on Indian politicians and parties to raise greater and greater sums for the next election, which may come at short notice. From 1951 to 1969, most private donations to political parties were legal, but public-sector firms-a considerable part of the Indian economy-were not permitted to make political contributions. Contributions from individuals and from other types of business firms were not subject to limits, but campaign spending itself was limited. In 1967, in response to growing electoral competition, the then-ruling Congress Party began to seek funds from nationalized industries over which the government had significant control, such as banking, insurance, and energy extraction. In 1969 corporate contributions-the primary source of legal party finance-were banned. Then, in 1975, the Indian Supreme Court ruled that political expenditures not authorized by a candidate do not count toward that candidate's spending limits. The result of this chain of events, Sridharan said, was that political finance essentially moved underground. Around 1980, many commentators argue, the Congress Party began relying on kickbacks from foreign firms. To maintain secrecy, the party tries to raise large sums through a small number of large transactions. By the time corporate contributions again became legal in 1985, most parties and their corporate benefactors had become used to the underground system of unreported cash or in-kind contributions. Since 1990 campaign expenditures have continued to skyrocket, Sridharan said, while expenditure limits-even after being increased in 1997-remain unrealistically low. Of course, since unauthorized expenditures do not count toward candidate limits, such expenditures technically do not violate the law. In effect, he added, there are no limits either on contributions or expenditures. Not only do scholars and journalists not have reliable data on election expenditures; candidates and parties themselves may not fully know what was expended on their behalf in election campaigns. Session II Discussion "Why would anyone want to tinker with this system?" Jong Wan Kim asked after hearing the myriad problems of these four countries. Politicians need money to win elections; business firms have money to donate in return for favors from government; and voters can be bought off for trifling sums from the politicians. Where, he wondered, is the incentive for change? But Noviantika Nasution, an Indonesian elected official, replied that "voters want us to change their lives" and cited numerous legitimate financial needs of political parties, especially in young democracies. And Smita Notosusanto said that voters were being shortchanged through government-business collusion but that it required a major public education campaign to inform them of this fact. Luie Tito F. Guia, a former legal advisor to the Philippine Election Commission, said that his country actually had good laws on political finance but that they were not enforced at all. "I think the worst thing a democracy can do is pass laws that no one will respect," Larry Diamond replied. He suggested that countries adopt modest reforms that can be achieved, especially measures that bring more disclosure and greater transparency to the process and that promote real electoral competition. |
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